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2009 (11) TMI 16 - HC - Income TaxCapital Receipt versus Revenue Receipt - the Additional Price received for sale of free sugar - Exclusion of Excise Duty and Sales-tax Collection from the total turn over for the purpose of computing the Income under Section 80HHC of the Income-tax Act, 1961 - held that - the character of the receipt of a subsidy in the hands of the assessee under a Scheme has to be determined with respect to the purpose for which the subsidy was granted. In other words, one has to apply the purpose test - Additional Price received for sale of free sugar is a capital receipt - Just as commission received by the assessee is relatable to exports and yet it cannot form part of "turnover" for the purposes of section 80HHC, excise duty and sales tax also cannot form part of 'turnover'. Just as interest, commission, etc., do not emanate from the 'turnover' so also excise duty and sales tax do not emanate from such turnover. - excise duty and sales tax also cannot form part of the 'total turnover' under section 80HHC(3).
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